If a vehicle has been repo'd by the bank, and then it was stolen, am I liable?

Question

My son recently surrendered his vehicle to the bank. The repo company came and got it. After it was delived to the bank, it was stolen. The bank is trying to hold him responsible for the total debt. Could that possibly happen?

Answer 1

He's liable if he signed on the loan. Banks always hold you responsible for your debt even if the car is repossessed. They will offer you a chance to resolve the back payments and regain possession of the vehicle. If you fail to do this in the alloted time, the bank will sell the car at auction and apply whatever monies realized against the balance of the debt. Then, you will still be responsible for any unsatisfied portion of the debt.

In the case where the vehicle was stolen from impound, it is assumed that the vehicle was still effectively in your possession. This works because you agreed that the bank had the right to protect its interest by seizing the vehicle and holding it until either you honored your debt obligation, or you chose to not fulfill your loan contract, thereby allowing the bank to proceed with selling the vehicle as I described above.

Did you maintain your insurance? If so, you have recourse through your theft coverage.

Otherwise, you may choose to sue the repo company, but I think they're protected or not liable unless you can prove some kind of gross breach or whatever.

Sorry. I'm sure this is not what you want to hear.

I'm going to make an inquiry and if I learn anything new or different, I'll come back and add to this post.

Source: family member who is a bank loan officer in charge of managing collections.

Answer 2

I think it probably all comes down to, Do you have any proof that the Repo company took it? A receipt for example? If you do, then it should not be a problem. If not, then you/your son would be the last recorded keeper, so you could well have a problem.
In the absence of a receipt, independent witnesses who saw it being removed would be a big help.
How did the repo company advise you that the car was stolen from them? If there is any "proof" of that, then you could be off the hook.
Did the repo company report the theft to the police? (that would be proof enough that they had it at the time it was stolen). If not, then you had better do so AS SOON AS POSSIBLE, and give them as much detail as possible.
Finally, if all else fails, I assume your son had at the very least TFandT insurance, so you should talk to the insurance company and explain the situation to them.
As I write this I am getting an uneasy feeling that, realising you have no proof that they took it, they might know exactly where it has gone.
This is not looking good at all.

Answer 3

I had my car repaid and it was not stolen, the bank still said I owed them the total sum left on the note. Now if my car had been auctioned off I would be responsible for the difference. you can not sue the bank, you can only prosecute the repo dealership because it was in their possession when stolen. So you have no way to buy back the car or pay only the difference from your balance and what it got at auction. If the repo place has something that says we are not responsible for lost or stolen vehicles in their contract with the bank you are out of luck, and better get a great lawyer if you ever don't want to pay the full price. You will end up paying it in lawyer fees though.

Answer 4

Once the bank accepts possession of the vehicle, then they are responsible for keeping it safe until it can be sold or otherwise legally disposed of. The bank will also charge you for the cost of repossessing and making the car ready for sale.

In a normal repossession case, once the lender has possession of the vehicle, it would be sold at auction, and the sale price, minus expenses would be deducted from the balance of your loan. You would still owe the balance of the loan, minus whatever profit was made from the sale of the car, but since the car was not sold, you will have to negotiate a settlement.

I'd suggest you should be talking with a lawyer as soon as you can to keep this whole situation from getting out of hand.

Answer 5

Whilst your son is 'responsible' for the debt, the bank's representitives (in this case the repo company) have collected from your son and delivered to the bank his 'payment' and in effect his debt has been discharged, assuming the value of the car covered the whole of the amount outstanding, and even if it didn't, he should only owe the difference. (If they'd lost it prior to delivery, the bank would be claiming on repo company's insurance). Imagine if, instead of a car, yoour son had handed over cash! It sounds to me as if someone has screwed up big time, and they're trying to get you to pay for it - I hope you've got a receipt.

Answer 6

Yes! The bank recovered it while it was still in your son's
possesion. Whatever happened to the vehicle after
that is the bank's problem, but your son is still liable for
the debt. Had the vehicle been stolen from your son's
possesion, then the insurance co. (if he had insurance
with full coverage in place) would've payed the bank for the
entire loss.

Answer 7

No.Once the bank has taken the vehicle and later lost you are not fully liable .But if the resale/market value is insufficent to close the loan balance and interest,you may have to pay the shortfall.but you must be able to prove that bank has taken possession of vehicle.Get legal assistance immediately.If you have recieved an notice/demand from bank,reply it through an advocate and keep a copy of the same.

Answer 8

in the adventure that they have listed you as a reference and also you have become the phone calls... you may tell them that you never gave authorization for useing your call and that you're going to sue for harassment in the adventure that they proceed to call. although, in case you probably did provide permission, and also you do understand the region of those 2 human beings... then you absolutely desire to grant that information up. in the adventure that they are stuck it is also conceivable to be charged for no longer providing huge-spread ideas. you also grants up the archives. and tell them that you probably did not authorize using your call and huge type and that you're going to provide them the most modern information that you've, yet previous that you don't understand a few thing... tell them that once they moved they wrote you off as well. I had this ensue to me as well... I instructed the corporation that "at the same time as they got here across him please let me understand the position he's so as that i visit get the grand he owes me again too". reliable success. never alow someone to apply you as a reference that you do not believe.

Answer 9

no legally, possesion/rights are transferred, there for responsibilites also, they are just trying to recoup their losses

Answer 10

no